Federal Realty Investment Trust (FRT) Down 2.6% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Federal Realty Investment Trust (FRT). Shares have lost about 2.6% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Federal Realty Investment Trust due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Federal Realty Q1 FFO Beats Estimates, Revenues Up Y/Y

Federal Realty Investment Trust posted first-quarter 2019 FFO per share of $1.56, which beat the Zacks Consensus Estimate by penny. The reported figure has also improved from the prior-year tally of $1.52.

Results reflect rise in property operating income and lease rollover for comparable properties.

Total revenues grew 3% year over year to $232.2 million. However, the top line missed the Zacks Consensus Estimate of $234.7 million.

Quarter in Details

During the reported quarter, Federal Realty signed 79 leases for 305,724 square feet of retail space. On a comparable space basis, the company leased 247,331 square feet at average rent of $45.07 per square foot. This denoted cash-basis rollover growth of 10%.

As of Mar 31, 2019, the company’s overall portfolio was 94.0%, down 80 basis points (bps) year over year. As of that date, comparable property portfolio was 94.6% leased, down 90 bps from the prior-year period. In addition, property operating income (POI) for comparable properties climbed 3.5% in the first quarter.

Federal Realty exited first-quarter 2019 with cash and cash equivalents of approximately $43.0 million, down from $64.1 million posted at the end of 2018.

Outlook

For 2019, Federal Realty maintained its FFO per share guidance at $6.30-$6.46.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

Currently, Federal Realty Investment Trust has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Federal Realty Investment Trust has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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